Tax Deducted at Source

TDS is a source of collecting tax by Government of India at the time when a transaction takes place. Here, the tax is required to be deducted at the time money is credited to the payee’s account or at the time of payment, whichever is earlier. Tax is deducted usually over a range of 1% to 10%.

Who has to deduct TDS and when?

Every company and LLP has to deduct TDS when making following payments:

  • Salary
  • Rent
  • Fees for any kind of services availed
  • Contract manufacturing

Due Dates for Payment of TDS

 Amount paid/creditedDue date of TDS deposit
Government OfficeWithout ChallanSame Day
With Challan7th of next month
On perquisites opt to be deposited by employer7th of next month
OthersIn month of March30th April
In other months7th of next month

What is TDS Return?

Apart from depositing the tax, the deductor should also file a TDS return.

TDS return is a quarterly statement to be given to the I-T department. It is compulsory for deductors to submit a TDS return on time. The details required to file TDS returns are:

  • PAN of the deductor and the deductee
  • Amount of tax paid to the government
  • TDS challan information
  • Others, if any

TDS Return Filing

Due dates of TDS Return FY 2019-20 :
Quarter Quarter Period TDS Return Due Date
1st Quarter 1st April to 30th June 31st August 2018
2nd Quarter 1st July to 30th September 31st October 2018
3rd Quarter 1st October to 31st December 31st January 2019
4th Quarter 1st January to 31st March 31st May 2019

Penalty for delay in filing TDS Return

According to Section234E, if an assessee fails to file his/her TDS Return before the due date, a penalty of Rs 200 per day shall be paid by the assessee until the time the default continues. However, the total penalty should not exceed the TDS amount

Non-filing of TDS Return

If an assessee has not filed the return within 1 year from the due date of filing return or if a person has furnished incorrect information, he/she shall also be liable for penalty. The penalty levied should not be less than Rs 10,000 and not more than Rs 1,00,000.

TDS Return Forms

Particulars Form No.
TDS on Salary Form 24Q
TDS where deductee is a non-resident, foreign company Form 27Q
TDS on payment for transfer of immovable property Form 26QB
TDS in any other case Form 26Q

Various forms are used for filing TDS return, depending on the purpose of deduction. These returns have to be in company with a signed verification in Form No. 27A. It is a form that controls the quarterly statements. This has to be filed by deductors together with quarterly statements. It summarizes the control totals of “amount paid” and “income tax deducted at source” which has to match with the totals in TDS return.